The 'Section 194N' of Income Tax Act deals with TDS on: MCQ with Answer and Explanation

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The 'Section 194N' of Income Tax Act deals with TDS on:

A. Rent

B. Professional fees

C. Commission

D. Cash withdrawals exceeding certain limits from bank accounts

Answer: Option D

Solution (By JKSSB Mock Tests)

TDS at 2% on cash withdrawals exceeding ₹1 crore (or ₹20 lakh for non-filers of returns).

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

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Legacy donation is generally treated as:

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B. Capital receipt

C. Liability

D. Revenue receipt

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Correct Answer: Option B

Explanation:
Legacy is a voluntary contribution of a significant nature, usually treated as capital receipt.

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Question #2

Wages paid for the erection of a new boiler should be debited to:

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Correct Answer: Option A

Explanation:
Capitalizing erection costs is required under standard accounting principles, so it is debited to the specific asset account.

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Question #3

As per AS 3, interest paid on loan is classified as:

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Correct Answer: Option C

Explanation:
Interest paid on borrowings is a financing activity under AS 3.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

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